Business, 16.03.2020 17:06, beccahaileyowzryu
You have the following information about Burgundy Basins, a sink manufacturer. Equity shares outstanding 20 millionStock price per share $40.00Yield to maturity on debt 7.5%Book value of interest-bearing debt $320 millionCoupon interest rate on debt 4.8%Market value of debt $290 millionBook value of equity $500 millionCost equity of capital 14%Tax rate 35%Burgundy is contemplating what for the company is an average-risk investment costing $40 million and promising an annual ATCF of $6.4 million in perpetuity. What is the internal rate of return on the investment? (hint: use the equation for a perpetuity)What is Burgundy’s WACC?If undertaken, would you expect this investment to benefit shareholders? Why and why not?
Answers: 3
Other questions on the subject: Business
Business, 22.06.2019 10:20, Sparkledog
Blue spruce corp. has the following transactions during august of the current year. aug. 1 issues shares of common stock to investors in exchange for $10,170. 4 pays insurance in advance for 3 months, $1,720. 16 receives $710 from clients for services rendered. 27 pays the secretary $740 salary. indicate the basic analysis and the debit-credit analysis.
Answers: 1
Business, 22.06.2019 13:00, ksteele1
Apopular low-cost airline, parson corp., has gone out of business. although the service and price provided by the airline was what customers wanted, the larger airlines were able to drive the low-cost airline out of business through an aggressive price war. which component of the competitive environment does this illustrate? a) threat of new entrants b)competitors c) economic factors d) customers d) regulators
Answers: 1
Business, 22.06.2019 16:10, SmokeyRN
Waterway company’s record of transactions for the month of april was as follows. purchases sales april 1 (balance on hand) 672 @ $6.00 april 3 560 @ $11.00 4 1,680 @ 6.08 9 1,568 @ 11.00 8 896 @ 6.41 11 672 @ 12.00 13 1,344 @ 6.51 23 1,344 @ 12.00 21 784 @ 6.61 27 1,008 @ 13.00 29 560 @ 6.79 5,152 5,936 (a) calculate average-cost per unit. (b) assuming that periodic inventory records are kept in units only, compute the inventory at april 30 using lifo and average-cost. (c) assuming that perpetual inventory records are kept in dollars, determine the inventory using (1) fifo and (2) lifo. (d) compute cost of goods sold assuming periodic inventory procedures and inventory priced at fifo.
Answers: 2
Do you know the correct answer?
You have the following information about Burgundy Basins, a sink manufacturer. Equity shares outstan...
Questions in other subjects:
Mathematics, 13.07.2019 14:00
Mathematics, 13.07.2019 14:00
English, 13.07.2019 14:00
